This is The Takeaway from today's Morning Brief, which you can sign up to receive in your inbox every morning along with: - The chart of the day - What we're watching - What we're reading - Economic data releases and earnings Showing up late to a party has its advantages. Just ask Apple. While Tim Cook's peers were struggling with failed AI rollouts, boardroom drama, and public backlash, he effortlessly entered the scene with an Apple Intelligence dish, and Wall Street analysts were eager to toast to it. On Monday, the company reached its highest point as Morgan Stanley named Apple a top pick, raising its price target based on an anticipated mega upgrade cycle driven by Apple's upcoming AI platform. Morgan Stanley analysts stated, "Apple Intelligence is a clear catalyst to boost iPhone and iPad shipments. " The fact that Apple's yet-to-be-released AI tools will only be available to 8% of existing iPhone and iPad users strengthens the case for an unusually large upgrade cycle, they added. Coupled with an already large user base and a replacement cycle that has stretched to nearly five years, there is a significant number of people eager for new devices. This speaks to Apple's AI strategy and its effective presentation of the practical applications of AI tools. By consistently highlighting everyday use cases, Apple has managed to transform the exaggerated promises of AI into something accessible (and profitable) within its ecosystem. Before Apple's surge in AI, skeptics in Cupertino pointed to the public's fatigue with upgrades, slowing iPhone growth, and a saturated US smartphone market. Recent hardware releases also led to complaints of a lack of innovation, fueling the narrative that Apple's prime days were in the past. When the company ended its electric car project in February, it appeared as though Apple was abandoning a bold initiative and succumbing to the AI trend.

But now that we have more insight into Cook's AI services-oriented approach, the company's AI strategy appears less like that of Google and Microsoft, and more like an extension of its walled garden, according to Loop Capital. Loop Capital likened Apple's AI potential to previous generational shifts in technology. Twenty years ago, the iPod served as the platform through which many consumers engaged with digital content. This was followed by the "late" iPhone, which redefined the category and became the foundation for social media. Now, through generative AI, managing director Ananda Baruah wrote that Apple's AI platform will become the preferred "base camp" for consumers. However, what stands out about Wall Street's overwhelming support is that Apple never truly escaped the hardware trap that its critics claimed had ensnared it. While AI technology and its applications may seem groundbreaking, the business implications for Apple are quite conventional: People will buy more phones. This may not be a revolutionary paradigm shift, but it is a reliable way to generate revenue. Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on Twitter @hshaban. Click here for the latest stock market news and in-depth analysis, including events that impact stocks. Read the latest financial and business news from Yahoo Finance.